StateWays is the only magazine exclusively covering the control state system within the beverage alcohol industry, with annual updates from liquor control commissions and alcohol control boards and yearly fiscal reporting from control jurisdictions
Issue link: https://read.dmtmag.com/i/307773
StateWays Q www.stateways.com Q May/June 2014 48 sell a large volume of product with a lower acquisition cost (quantity discounts) at a low margin, which forces small store owners to sell at or below cost, ultimately forcing them out of business. Small distillers' products are removed from the national grocers' shelves and replaced with higher-margin national and house brands. Revenue that previously went to local distillers is funneled back to the national grocers' headquarters. The consumer pays more to cover the new wholesale distributor and national grocer mark-ups, as these two new business entities replace the services previously provided by the control state. In addition to negatively impacting small store owners, small distillers and consumers, national grocers' privatization efforts dramatically increases the number of liquor outlets. An increase in liquor outlets usually leads to an increase in liquor theft, underage drinking and public intoxication. This places an additional burden on local law enforcement, social services, and medical facilities. Privatization is a well-organized and well-funded attempt by national grocers to take a large revenue stream from the state, with total disregard for all the other stakeholders. Unfortunately, there is a lot of misleading information circulating which makes it very diffi cult for the voting consumer to make an informed decision. In the end, if the voting consumer makes the same decision the voters of Washington State made, they will pay more, have less selection, and pay the price for the social ills associated with less restrictive alcohol distribution models. Scott Oppenheimer Senior Vice President Control States Moet Hennessy USA T he Theme of the 2014 NABCA Conference, "Protect and Serve," is particularly relevant in the current industry environment. Specifi cally, control states must protect their citizens from the potential dangers of alcohol, but at the same time provide the high level shopping experience that today's consumers are demanding. Not only do I believe this theme to be very strategic and critical to the long-term health of our industry, but it also makes me very proud to be associated with NABCA. Control states and NABCA continue to lead in reinforcing the responsibility message to consumers as well as suppliers. I can imagine that every supplier attending this conference has had numerous and in some cases challenging inquiries from different control states regarding what steps they are taking to ensure their brands are consumed in a responsible manner. Does this mean control states are not in favor of alcohol? I do not think so; in fact, in 2013, distilled spirits depletions grew by 519,000 cases and retail dollars grew by $311 million. In addition, retail dollars grew almost three times faster than depletions. Control states have clearly found a way to balance responsible consumption while effectively serving consumer needs. These efforts and the infl uence control states have on the supplier tier as a whole help drive responsible selling and marketing practices across the entire U.S. Efforts to better serve customers, and modernize the retail or wholesale environment have contributed to this growth. For example, the increasing number of warehouse upgrades is allowing the states to expand their product offerings to satisfy a growing consumer demand for fl avored and luxury priced spirits. This has had a direct impact on business, as consumers are spending more time and dollars in accounts featuring a broader selection of products. In addition, suppliers now have more access to on-premise data and are also able to see depletions through the PMR much faster than previous years and on pace with the private sector. As a result, the supplier community can make decisions more quickly from actual data. Also, many states are building capabilities in both digital and in-store marketing. These new resources are enabling suppliers to create custom programs for specifi c cities or states. We continue to see increased Sunday sales, new store openings, store upgrades and a continued effort to improve service to the customer. The combined efforts across NABCA to balance the responsibility message – "protecting" while creating an improved shopping environment "serving" – is delivering measurable results and sending an important message to all players in the industry. The Moet Hennessy USA dedicated control sales force, brokerage and operations team is thrilled with our business across NABCA. MHUSA shelf dollars grew 9.4% in 2013 on top of a very strong 2012. We look forward to continue success as we work together to create value in a responsible manner. A t Constellation, Corporate Social Responsibility (CSR) has been woven into our company's culture and core values since our founding. The premise behind this commitment has always been the same, we have a responsibility to care for the land, people and communities where we live and work. NABCA Industry Steering Committee Roundtable